VISION 202012 INNOVATIONS & MEGA TRENDS TOWARDS THE COMING DECADE

DISRUPTION Movement or trend that is changing industries, relating to or noting a new product, service, or idea that radically changes an industry or business strategy, especially by creating a new market and disrupting an existing one.

INNOVATIONTRANSLATION - The process of translating an idea or invention into a good or service that creates value or for which customers will pay. To be called an innovation, an idea must be replicable at an economical cost and must satisfy a specific need. INNOVATION - involves deliberate application of information, imagination and initiative in deriving greater or different values from resources, and includes all processes by which new ideas are generated and converted into useful products. SATISFACTION - In business, innovation results when ideas are applied by a individual, company, or other entity to further satisfy the needs and expectations of consumers.

TRENDPATTERN – A gradual change in a condition, output, or process, or an average or general tendency of a series of data points to move in a certain direction over time. TO FOLLOW - Not only be aware of what is currently happening, but be astute enough to predict what is going to happen in the future. TO LEAD - To have access to, and be able to base decisions upon, contextual information central to the consumer and marketplace for the product, service or concept in mind.

CONTEXT BACKGROUND - Context is most purely the background, environment, framework, setting, or situation surrounding a previous or current event, occurrence, or timeframe. RESEARCH - Context is the information necessary to correctly interpret anything from a word or phrase, or a concept or trend that could otherwise be interpreted in a number of different ways. MEANING - When you say something is out of context you basically mean it's out of place. To be successful we must be IN context.

INNOVATION PROCESSCURRENT SITUATION

DRIVERS – FROM PRESENT ENABLERS TO PAST CONEXTDEMOGRAPHY • PSYCHOLOGY • BEHAVIOR

CREATIVE IDEATION • CREATING VALUERESOURCES • SOURCING • PRODUCTION

MARKETING • ADVERTISING • PRMERCHANDISING • DIRECT MARKETING • SALES

DELIVERY • SERVICEREINFORCEMENT • RELATIONSIP BUILDING

TREND 1 – THE SHARING ECONOMY Peer 2 Peer “P2P” or Collaborative Consumption in Transport, Hospitality, Product, and more… (Uber, AirBnB, YoooWe) Travis Kalanick’s idea of progress is simple and sweeping: transportation as ubiquitous and reliable as running water, everywhere, for everyone. And as part of that vision, he expects to change the way cities operate.

TREND 1 – THE SHARING ECONOMY The Numbers Uber is likely the fastest-growing startup in history and definitely the most valuable at $62.5 billion, a figure that is quickly approaching the market capitalization of Volkswagen, the largest automaker on earth. It has 1.1 million active drivers (which it defines as independent contractors who have offered at least one trip in the past week) in 361 cities—nearly 100 of which Uber expanded to in 2015. The ChallengeWhile at the same democratizing the labor market, Uber and other similar CC concepts are fairly typical examples of what disruptive technologies can do to labor. From English textile workers to travel agents, new technology destroys job categories at the same time as it creates them.

TREND 2 – FREE FOR SERVICEProviders and publics are accessing information, entertainment, and other content and services at no direct cost (price for access or usage) to users to an extent not seen before. This trend has been empowered by mass access to and adoption of online tools and destinations, and serves as a major disruptor to the entertainment, content and services industries including music, movies, literature, and communications (‘VOIP’ – Skype, Face Time etc.)

The Drivers Mobility and the applications and tools that drive it have driven consumers to become increasingly unwilling to pay for access and use across entire business categories, those businesses directly impacted must quickly adopt alternative means of generating revenue in support of providing those very same services or products.

Niklas Zennstrom - Look for when the environment is changing — the big shift now is mobile Internet. It’s really happening big-time. The way you interact with services on a smart phone compared to the Web is quite different, so there’s a huge opportunity.

TREND 2 – FREE FOR SERVICEThe Challenge The trick here is to try to figure out the thing that’s unexpected. When we started Skype, if you look at analyst reports, no one forecasted it as a big business. Also when Google started, it was not fashionable to be in search. It’s not trying to do the obvious – that’s the hard part. You have to figure out what it is – you have to stumble on it.

TREND 3 – ENTREPRENEURS & STARTUPEntrepreneurship & Small Business… Traditional Business Makes a Comeback with personalization and the web as catalysts.Two Harvard Business School graduates started Birchbox in 2010 as a monthly subscription service that delivers personalized selections of beauty products to your door. Today, that concept has grown into an offline store in Manhattan and online service in Canada, as well as a women's magazine and lifestyle guide for men.

That combination, along with Barna and Beauchamp's business smarts, catapulted Birchbox to an April 2014 valuation of $485 million. They've sent out millions of boxes so far and have even expanded across the ocean to five European countries.

TREND 3 – ENTREPRENEURS & STARTUPThe NumbersIn the US, Startup activity saw the largest annual increase in 20 years. Denmark is a hub for cutting edge companies in a variety of different industries. We are considered one of the European Union’s top clusters regarding Life Science, ICT, Design and Clean Tech & Sustainable Energy.The Challenge Eighty percent of new entrepreneurs previously held jobs - more than last year but still lower than historical norms. There are now 310 entrepreneurs for every 100,000 adults in the U.S., which translates into 530,000 new business owners every month, the report says.

"Entrepreneurship in all its forms will continue to be essential to rising standards of living and expanding economic opportunity."

TREND 4 – THE SLOW MOVEMENT Be on the lookout for handmade, small batch, artisan and stone-ground products embodying crafting techniques long revered by some consumers from Cuisine, Beverages, and Fashion. Originally unique to the Specialty Gourmet universe, regional artisanal products are making their mark in all channels as entrepreneurs continue adapting small-scale production to supply retail stores – without losing quality.

Brands that stay dedicated to their home state are popping up more and more, answering growing consumer demand for foods that also match production values important to them: low carbon footprint, organic, biodynamic, even Certified B Corporations™.

TREND 4 – THE SLOW MOVEMENT The Numbers (Apparel Industry Example) According to author Lucy Siegle's "To Die For: Is Fashion Wearing out the World?" Americans purchase, on average, 68 pieces of clothing and eight pairs of shoes annually. That's about 25 billion garments each year, well more than the 7.3 billion people who inhabit the planet.The Challenge Educate, inspire, and influence change in the fashion industry by encouraging consumers to slow down and make more conscious consumption decisions. From McDonalds to H&M this trend promises to challenge the well established business models of companies for whom volume sales has been key.

TREND 5 – MICRO-MARKETS & SEGMENTATION – BIG DATADiversity, Pride & Product Development The advent of the internet and mobile communications was foreseen as a great equalizer, necessitating a broad industry move towards standardization. The trend towards consumer tastes becoming more common never came to be, in fact, the reverse effect has been a hallmark of the internet and mobile.Quantifying Factor…- Demography as an AnchorQualifying Factors… - Psychology as context and message driver - Behavior as attraction and permission

TREND 5 – MICRO-MARKETS & SEGMENTATION – SMALL DATA

TREND 6 – INTEREST BASED MEDIA Interest (Instagram) Media Overtakes Social (Facebook) in Effective Business Communications.Ariana Huffington – The Huffington Post - The Huffington Post is the Tesla of media because it is the closest thing to a traditional entity that sprang into being, seemingly out of nowhere and very quickly forced the industry to question a lot of long-held assumptions. Among those assumptions were the following: No one of any quality would write for free, Users wouldn’t want a news aggregator, A new entity couldn’t build a large audience, Viral content can’t be treated like a science, A viral-media site couldn’t evolve. All of this helped The Huffington Post build what became a $315-million organization in a little more than 5 years, right under the noses of the largest and world’s most well-funded media entities.

TREND 6 – INTEREST BASED MEDIA

TREND 7 – THE NEW CONSUMERISMConsumer as a Marketing Force – Affinity, Advocacy & C to C Marketing (Instagram, Yelp, Trip Advisor, Pinterest) Individualism – Expression as the Driving Force in Brand & Product Selection Customization – Demand and Access (e.g. Emerging Technology 3D Printing) Dynamic shift from Trinkets and Trash to Treasure – Made in China, Home Goods, Fast Fashion are on their way out, the great recession changed buyer behavior) Limited lines, specialty, and collaborations (adding depth and breadth to consumer choice) Immediate Gratification – Drone Delivery to 3D Printing (Nike & Adidas)  

TREND 7 – THE NEW CONSUMERISM 

TREND 8 – DEMOCRATIZATION OF LUXURY Broad-based global demand… Luxury is…living an unforgettable experience

Dining Out

Personalized Service

Boutique Size

Intimacy

TREND 8 – DEMOCRATIZATION OF LUXURY

TREND 9 – LIFESTYLE Small Living – Simplicity & Small Become the New ‘Conscious’ OR ‘Simple’ Status Symbols Urbanization – Historic Migration to Cities and Urban Centers Escape to the Wilds – The New Pioneers & Explorers

TREND 9 – LIFESTYLE

TREND 10 – PRODUCTS & SERVICESCustomization – Micro Sourcing & Manufacture, Crowd Funded Sales, Capsule Collections Authenticity – Brand & Product Meaning, Context, Construct & Communications Handcraft – On-Shoring, Craft Movement, Makers & Merchants Enabling their Sales (Etsy, Big Cartel, etc.) Smart Products – smart shoes, smart cars, smart appliances, smart homes (Internet of Things – maturity of web communications – we’re busy, our homes, appliances, and transportation must and will get smarter and help us fill in the gaps. (Consumer)Industry 4.0 (similar to the consumer market above) but targeted to assist business (smart warehouses, logistics, supply chain, production – robotics, communications) Wearable tech – music, data, communications, perhaps migrating to implants

TREND 10 – PRODUCTS & SERVICES

TREND 11 – CORPORATE STRUCTURE & WORKPLACEON-SHORINGVertical Integration – All or Most Functional Areas Consolidated within the Company rather than outsourced to agencies at home or providers abroad

TREND 11 – CORPORATE STRUCTURE & WORKPLACE

SOCIAL ENTERPRISE & RESPONSBILITY Triple Bottom Line Reporting – Measured Impact of Financial, Human Resource, and Community, B CorporationAnn Wang, 24, Jessica Willison, 24 - Cofounders, Enrou an online marketplace where customers can purchase products that are made in the U.S. and developing communities around the world. The company creates jobs and also links artisans with local organizations that provide training and educations. Buyers are introduced to creators via stories that accompany the goods.

CROWD MEETS COMPANY Co-Working & Incubation – The Sharing Economy Meets the Workplace – Agilent Growth

TREND 12 – RETAIL & MERCHANDISINGOMNICHANNEL - Click to Brick / Omni Channel – Bridging the Digital Divide Between Consumer & Seller. Technology Meets Storefront – Integrate Online Virtual with In-Store Experience Angela Ahrendts - To her, the store is a "big giant product" in itself," and she says it has evolved in a similar way as the iPhone and Mac, and gotten "sleeker and smarter" over the years. But, she wonders: "How do we get our kids who prefer no human interaction into these stores?” The company is now working to better unite its online and offline experience. Ahrendts also wants to re-center the physical experience around particular "passion points." Next - "The Avenue," which has Apple’s accessories repositioned from the wall into an experience that feels more akin to walking down the street of a "small town and looking into each window.”

TREND 12 – RETAIL & MERCHANDISING